The food and beverage market is valued at $408 trillion as of 2019. As is, the demand volumes in the food industry are huge and considering the need for fresh foods, it requires companies working in the industry to work with highly efficient supply chains. Producers and retailers alike need to work around the clock to make sure that their customers find no reason to complain unless they want to risk losing market shares to the intense competition.
These dynamics are really complicated, considering how e-commerce has significantly reduced service delivery timelines significantly. Now, businesses in the industry don’t only have to meet customer demands, they have to meet them faster. To do that, inventory management must become quicker and supply chains need to become much more efficient to meet the rising pressures from the industry.
An Order Management Solution (OMS) automates various functions to help improve service delivery, logistics and inventory management. These are comprehensive databases which are automatically updated in response to the various transactions that you conduct, will manage invoices and provide your customers with the ability to monitor their purchases through your various outlets.
This speeds up existing processes and frees up valuable human capital as well as finances that you can direct towards other core organisational competencies. An Order Management System will take over the grunt work in retail or wholesale, to impact your business in positive ways across multiple organisational facets.
Advantages Of Working With An OMS
Order Management Systems can be said to directly affect your organisation at three basic levels. Every other benefit of an OMS to your financial planning or management is derived from these three effects. These three levels are:
- Cost Efficiency
- Service Efficiency
- Customer Services
The Cost Advantages of OMS
Warehouse costs are one of the biggest financial burdens on any retail or wholesale organisation. Maintaining the warehouse and staffing are the two major expenses associated with running a warehouse.
65% of all warehouse operating costs are the costs of staffing the place. This will include their wages, insurance payments and any other costs associated with your labor force. An OMS can perform the same jobs as your warehouse staff, which takes away 65% of the costs associated with the keeping your warehouses occupied.
In addition to this, recent years have outlined an increase in warehouse renting costs by a total of 28%. With this increase, the financial burdens associated with managing a warehouse are going to get heavier. An OMS can render most of the cost incurring constituents of your warehouses to streamline financial and warehouse management.
Improved Service Efficiency
Pencil and paper inventory management is a very long and drawn out exercise. You need entire teams of people who can take inventory for a full warehouse; which can take days to complete. Besides this time inefficiency, the length of the process makes it a lot more likely that someone is going to make a mistake.
This can have long-term impacts on businesses where financial and human resources are bound to carrying out the task. This has implication for how well you will be able to serve your customers. If there is a mistake in the inventory management, then you can’t really meet client demands properly or perhaps divert funds to another part of your company in need of funds.
Many OMSs are also capable of generating invoices and serving as a platform for interaction between you and your clients. This takes away a large part of the hassle associated with maintaining sales records, transaction receipts and all the other paperwork associated with transaction management.
Taking on an OMS can eliminate all of these risks and frees up your resources to be distributed across your enterprise. With this, you will find that your service delivery processes become much more efficient. You will be able to provide accurate information to your customers, plan out inventory for future demand variations and keep track of all the transactions that have already taken place.
With this information, you can develop contingency strategies against any eventualities which might hamper your organisational workflow.
Customer Service Improvements
Order Management Systems can be implemented into your ordering platforms on applications platforms and incorporated with order tracking, completion updates and much else. This reliability develops a sense of trust on your services as a retailer and/or wholesaler.
When your clients can see where and how far their orders are, it eases their minds and makes them comfortable using your services. Knowing where their orders are and that their money hasn’t wasted on something like a scam does away with many of the hindrances in the success of your online businesses.
Food service suppliers, especially, can provide order tracking to their customers to develop a wholesome relationship with their clients to solidify their consumer base. This goes a long way in maintaining healthy client relationships and customer experience with your business.
The Components of an OMS
In order to render these services, Order Management Systems are installed with a wide range of operational capabilities and functionalities. These include:
Customer Account Management System
Order Management Systems are designed with comprehensive customer management systems which can hold an entire customer’s history with your business. These databases can be further manipulated to group similar customers together to create group specific pricing lists and packages dedicated to each group. Many of these simply allow you to import your customer lists onto the platform, from whichever platform you were using before.
In terms of understanding your customers, this serves as a segmentation of your consumer base which you can further use when it comes to deciding marketing strategies for this segment.
Inventory management is a core part of Order Management. OMS systems also serve as inventory maintenance software which can then help you keep up with your sales volumes, revenues and a lot more.
An OMS gives you control over categorising your products, your suppliers and create price tiers for each product based on whatever pricing strategies you choose. This cataloguing also lets you adjust your prices for individual products or for each in bulk.
When it comes to dealing with different groups of products, for example per unit (such as clothes) or by weight (such as fruits and vegetables); these products can help you create categories such that you can price them based on the unit of measurement. If you’re dealing with a diverse set of products in your company, an OMS can singlehandedly manage your entire inventory.
Sales and Order Management
Sales and Order Management are obviously the core functions of any OMS. Even the most basic Order Management System will help you:
- Sort your products based on the company it was ordered from, order statuses, delivery dates and similar categorisations.
- Edit the details of your orders such as change addresses, order quantities, product pricing in the case of discrepancies and much more.
- Inform your customersif any changes are made to the orders once it has been finalised by you.
- Create invoices and order completion notifications which can be sent ahead to the accounting systems.
- Create orders for clients who may order in through channels besides your online access points.
OMS systems are created with extensive reporting tools which can generate highly detailed and skillfully organised data representations to help understand your existing processes. These reports are updated in real time as your inventory and accounts go through any changes based on the transactions you conduct.
These reports include:
- The number of orders you receive within pre-specified time intervals.
- Classify your orders based on whether they have been completed or when they were submitted.
- They can also tell you who the most frequent customers are, which products generate the most revenue and provide access to the most recent orders that have been received.
With this information you can assess your stock turnovers, improve your stock control strategies and understand what decisions you ought to take with regards to your product flows.
Notifications and Easy Conversion of Data
You can configure your Order Management Systems to notify you each time a change is made to your inventory. This helps you keep a check and balance on any potential discrepancies and keep up with how your business is doing.
In addition to this, most OMSs are also equipped with data conversion software, which will allow you to transfer data in whatever form you want to whichever platform you want.
Improved Decision Making with Order Management Systems
Order Management Systems can make for a valuable addition to your organisation by helping provide concise and accurate information regarding your inventory, customers and vendors. With this information you can improve internal coordination and gain a holistic view of the standing of your company.
Ordertron is an Order Management System that helps foodservice wholesalers and suppliers improve inventory management for improved business outcomes. Their Order Management Systems are designed for Food Service Suppliers and Small Businesses, with Android and Apple iPhone applications for their clients. Get in touch with them today for more information on their services or to take on their OMS for your business.